The Central Board Of Direct Taxes (_CBDT ) Vide Instruction No 7/2014 dated 26.09.2014 had clarified the extent of enquiry in certain category of cases specified therein, which are selected for scrutiny through CASS Further clarifications have been sought regarding the scope and applicability of the aforesaid Instruction to cases being scrutinized.

2 In order to facilitate the conduct of scrutiny assessments and to bring further clarity on some Of the issues emerging from the aforesaid Instruction, following clarifications are being made:

i, Year of applicability :; As stated in the Instruction No. 7/2014, the said Instruction is applicable only in respect of the cases selected for scrutiny through CASS-2014

ii Whether the said Instruction is a Idle to all cases selected under CASS: The said Instruction is applicable where the case is selected for scrutiny under CASS only on the pararneter(s) of AIR/CIB/26AS data if a case has been selected under CASS for any other reason(s)/parameter(s) besides the AIR/CIB/26AS data, then the said Instruction would not apply.

iii Scope of Enquiry :Specific issue based enquiry is to be conducted only in those scrutiny cases which have been selected on the parameter(s) Of AIR/CIB/26AS data In such cases the Assessing Officer, shall also confine the Questionnaire only to the specific issues pertaining to AIR/CIB/26AS data Wider scrutiny in these cases can only be conducted as per the guidelines and procedures stated in Instruction No. 7/2014.

iv. Reason of selection in cases under scrutiny for verification of AIR/CIB/26AS data, the Assessing Officer has to intimate the reason for selection of case for scrutiny to the assessee concerned.

3. As far as the returns selected for scrutiny through CASS-2015 are concerned, two type Of cases have been selected for scrutiny in the current Financial Year

- one is Limited Scrutiny' and

other is _Complete Scrutiny'

The assessees concerned have duly been intimated about the if cases falling either in Limited Scrutiny' or 'Complete Scrutiny' through notices issued under section 143(2) Of the Income-tax Act 1961 (_Act'). The procedure for handling _Limited Scrutiny cases shall be as under:

a. In 'Limited Scrutiny cases, the reasons/issues shall be forthwith communicated to the assessee concerned.

b, The Questionnaire under section 142(1) Of the Act in _Limited Scrutiny cases shall remain confined only to the specific reasons/issues for which case has been picked up for scrutiny.

c These cases shall be completed expeditiously in a limited number Of hearings

d During the course of assessment proceedings in _Limited Scrutiny' cases, if it comes to the notice of the Assessing Officer that there is potential escapement of income exceeding Rs five lakhs (for metro charges the monetary limit shall be Rs ten lakhs) requiring substantial verification on any other issue(s) then the case may be taken up for _Complete Scrutiny' with the approval of the Pr. CIT/CIT concerned. However such an approval shall be accorded by the by the Pr. CIT/CIT in writing after being satisfied about merits of the issue(s) necessitating _Complete Scrutiny in that particular case. Such cases shall be monitored by the Range Head concerned. The procedure indicated at points (a) (b) and (c) above shall no longer remain binding in such cases (For the present purpose _Metro charges' would mean Delhi, Mumbai, Chennai, Kolkata, Bengaluru, Hyderabad and Ahmedabad).

4~ The Board further desires that in all cases under scrutiny where the Assessing Officer proposes to make additions or disallowances the assessee would be given a fair opportunity to explain his position on the proposed additions/disallowances in accordance with the principle of natural justice, In this regard, the Assessing Officer shall issue an appropriate show-cause notice duly indicating the reasons for the proposed additions/disallowances along with necessary evidences/reasons forming the basis of the same. Before passing the final order against the proposed additions/disallowances due consideration shall be given to the submissions made by the assessee in response to the show- cause notice.

5. The contents Of this Instruction should be immediately brought to the notice of all concerned for